NEW YORK -- U.S. stocks fell Thursday, after the Standard & Poor's 500 index approached a record high yesterday, as concern about Europe's debt crisis overshadowed better-than- estimated American economic data.
Oracle plunged 9.7 percent after sales and earnings missed estimates. Cisco Systems and Juniper Networks slipped at least 2.2 percent amid an analyst downgrade. Guess? fell 7.2 percent after its revenue forecast trailed projections. Yahoo! added 3.5 percent as Oppenheimer & Co. upgraded the shares.
The S&P 500 fell 0.8 percent to 1,545.8, headed toward its second weekly decline of the year. The Dow Jones industrial average lost 90.24 points, or 0.6 percent, to 14,421.49. About 5.9 billion shares traded hands on U.S. exchanges on Thursday, 6.7 percent below the three-month average.
Equities slid as a purchasing managers' index for Germany's manufacturing industry unexpectedly fell this month while a measure of euro-area services and manufacturing output contracted more than forecast.
The European Central Bank said it may cut Cypriot banks off from emergency funds after March 25 as the island nation's president, Nicos Anastasiades, struggled to forge agreement on a plan to stave off financial collapse.
"We don't feel anything has been solved in Europe in terms of the debt situation there," Eric Thorne, who helps oversee about $6 billion at Bryn Mawr Trust in Bryn Mawr, Pa., said in a phone interview. "Europe and the surrounding economies having trouble could well be the reason that the market decides to pause here for a while."
In the U.S., sales of previously owned homes rose in February to the highest level in more than three years. Purchases increased 0.8 per
cent to a 4.98 million annualized rate, the most since November 2009, figures from the National Association of Realtors showed Thursday in Washington.
Other data showed applications for jobless benefits increased by 2,000 to 336,000 in the week ended March 16, while the Conference Board's gauge of the outlook for the next three to six months climbed 0.5 percent for the second straight month.
Nine out of the 10 S&P 500 groups fell Thursday as raw-materials and technology companies dropped the most, sinking at least 1.3 percent. The Chicago Board Options Exchange Volatility Index, which measures the cost of using options as insurance against declines in the S&P 500, climbed 10 percent to 13.99. The gauge, known as the VIX, is down 22 percent this year and reached its lowest level since February 2007 last week.
Oracle led the slump in technology shares, tumbling 9.7 percent to $32.30. The largest database-software supplier reported sales and profit that missed analysts' estimates as CEO Larry Ellison is being stymied by customers switching to Internet-based cloud systems, curbing their reliance on Oracle's servers, databases and related programs.
Cisco declined 3.8 percent to $20.84 while Juniper Networks lost 2.2 percent to $18.89. The makers of networking equipment were cut to underperform, an equivalent of sell, from market perform at FBR Capital Markets. Increased competition means there will be a slow but "meaningful" reduction in the number of routers and switches deployed into networks, analyst Scott Thompson said in a note.
Jabil Circuit retreated 4.5 percent to $18.60. The contract electronics manufacturer forecast earnings excluding some items of 58 cents a share at most for the fiscal third quarter. That trailed the average analyst estimate of 61 cents in a Bloomberg survey.
Airgas dropped 5.2 percent to $97.96. The largest U.S. distributor of packaged gases said it may not meet its fiscal fourth-quarter earnings guidance after sales didn't increase through February.
Guess slid 7.2 percent to $25.01. The maker of designer jeans forecast annual revenue of $2.6 billion to $2.64 billion, less than analysts' estimates of $2.74 billion.
Yahoo, the largest U.S. web portal, rose 3.5 percent to $22.86. The shares were upgraded to outperform, meaning investors should buy the shares, from market perform at Oppenheimer, which cited the value of Yahoo Japan shares and a possible initial public offering of Alibaba.com in the next 12 months.
KB Home, the best-performing U.S. homebuilder stock this year, rallied 2.5 percent to $22.10, its highest level since September 2008.
The Los Angeles-based company reported a narrower loss for its fiscal first quarter as sales and prices climbed amid a nationwide rebound in housing construction.